Gold struggling to gather traction as traders wait for a new catalyst.
The gold price (XAUUSD) struggles to capitalise on the overnight. Rebound from the weekly low, which is around $2,025-2,024. And oscillates in a range during the Asian session on Thursday.
Traders also choose to remain on the sidelines ahead of the US PCE Price Index announcement.
Traders prefer to wait on the sidelines. And waiting to the release of the US Personal Consumption Expenditures (PCE) Price Index. For clues regarding the Federal Reserve’s (Fed) rate cut path before putting additional directional wagers around the non yielding yellow Metal . In the run up to critical US inflation data. A minor US Dollar (USD) decline is expected to provide some support to the gold market. Aside from that, the overall softer tone in the equities markets appears to be another element benefiting the safen haven precious metal. However, the lack of follow through purchasing should cause some concern for aggressive bullish. Traders before positioning for a continuation of the recent recovery from the YTD low.
Daily Market movers: Gold price lacks a solid intraday direction amid mixed fundamental cues.
The uncertainty surrounding the critical US inflation report dampens investors’ desire for riskier assets. And offers support to the safe haven gold price amid a minor US dollar decline.
Several Federal Reserve officials have reiterated Wednesday. That more effort was needed to reduce inflation. Allowing the central bank to maintain interest rates higher for a longer period.
New York Fed President John Williams stated that the US central bank will begin decreasing interest rates in 2024. Albeit in the latter half of the year, as the route to the 2% inflation target is uneven.
Atlanta Fed President Raphael Bostic stated that he is comfortable advocating patience. When it comes to relaxing policy, adding that the central bank has not declared victory against inflation yet.
The Fed’s higher for longer interest rate story limits the upside for the XAUUSD.
Separately, Boston Fed President Susan Collins stated that the central bank will most likely decrease interest rates this year, but that it should take time to review evidence before making any policy changes.
The second According to an estimate of US GDP growth issued on Wednesday, the US economy increased at a 3.2% annualized rate in Q4, slightly less than the 3.3% increase previously reported.
Meanwhile, the statistics supported the assumption that the US economy is in good shape, as well as hawkish Fed views, but did little to boost the US dollar.
Nonetheless, the Fed’s hawkish attitude on interest rates may limit any additional appreciation in the non-yielding metal ahead of the US Personal Consumption Expenditures (PCE) Price Index.
Thursday’s US economic docket also includes the release of Weekly Initial Jobless Claims, the Chicago PMI, and Pending Home Sales, which, combined with Fed talk, may provide some momentum.
